Kimberly Harris-Ferrante here. The number of acquisition announcement from vendors has me thinking about what is yet to come in the crowded insurance technology market. The market today is extremely crowded with many best of breed vendors that offer a solution to solve only a single business issue, meet the needs of a single product line or region, or support only one part of a multi-step process. In many regards, this is worsening over time as new technology vendors enter the market to solve new business problems – for example providing mobile applications for claims or e-signatures. While these are critical aspects for insurance processing, they are narrow and niche business processes.
Increasingly insurers want to control complexities in their vendor landscape, as well as reduce the number of vendors which they need to integrate and manage. This is conflicting to the current market conditions and one factor which is driving the vendor market consolidation. Vendors merging or acquiring to support end-to-end processes and filling product line gaps is a positive step forward for an ever complex vendor market. While there will be confusion and disruption as acquisition happens, it should be seen as positive long-term. Gartner hopes more consolidation will happen over the next 3 years, as well as more partnerships and OEM relationships between vendors. Supporting end-to-end processes should be a goal of vendors and a consideration in their long term business development. Niche vendors may be good for tier 1 buyers especially for state of the art and innovate technology, however this model will be too complex for mass market buyers. I say – consolidate and partner away! There are too many vendors and too much complexity today in this market.
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